The traffic operation logic of Taobao, Douyin and Kuaishou!

In the traditional centralized e-commerce model, the platform is the center of transactions and communication between brands, merchants and consumers, and has strong control over traffic, transaction data and customer relationships.

With the development of e-commerce in a social, content-based and decentralized manner, the platform's strong control over merchants and consumers has begun to gradually decline, making it more efficient and cost-effective for brands, merchants and consumers to establish direct contact and conduct sales conversions.

In the process from traffic acquisition to conversion operation, the value of private domain traffic continues to increase.

BATTK (Baidu, Alibaba/Weibo/Xiaohongshu, Tencent/Bilibili, etc., Toutiao/Douyin, Kuaishou) currently occupy 70% of the mobile Internet.

Among them, Alibaba and Baidu are representatives of the search model, Tencent is the dominant player in the social model, ByteDance is the pioneer in the recommendation model, and Kuaishou combines social and recommendation...

As the traffic costs of centralized platforms continue to rise, the control of the three types of platforms over traffic has weakened to varying degrees.

In particular, centralized e-commerce platforms represented by Alibaba and JD.com are beginning to face the reality of slowing GMV growth.

Therefore, centralized e-commerce platforms began to obtain traffic from external platforms (WeChat, TikTok, Xiaohongshu, Bilibili, etc.) through technical cooperation, investment and acquisition.

On the other hand, we continue to innovate new products and new models to strengthen the stickiness of brand merchants and users within the platform (Weitao, Youhaohuo, Wow Video, Taobao Live, Brand Accounts, JD Discovery Accounts, JD Live, etc.).

For the platform, the slowdown in traffic has enabled it to further tighten its control over traffic, prompting more traffic to be concentrated on leading companies and the clearance of mid- and long-tail merchants.

Under such circumstances, it is more urgent for small and medium-sized businesses to integrate with private domain traffic.

So, further studying and analyzing the platform's public domain traffic and private domain traffic, what is the operational logic between them?

First of all, it should be clear that when there is abundant traffic, a large amount of free or low-priced public domain traffic can be converted into private domain traffic for brands and merchants, and the private domain traffic of merchants is then deposited on the platform and becomes the public domain traffic of the platform.

However, when the traffic dividend declines, the platform's control over public domain traffic and monetization demands increase, and the contradiction between public and private domain traffic intensifies.

Secondly, private domain is not a new concept. Before social networking became popular, address books and emails were manifestations of private domain traffic.

With the emergence of social platforms such as WeChat and Weibo, the connotation of private domain traffic has been further extended. For brands and businesses, private domain traffic also means real user asset accumulation.

On the one hand, many brands and merchants have accumulated a certain amount of initial "fans" in the traditional e-commerce model, but in fact, the users of centralized platforms belong to the platform and have no close relationship with the brand merchants. Only by importing users into their own platforms (independent apps, WeChat groups, public accounts, personal accounts, corporate WeChat, etc.) can controllable private domain traffic be achieved.

On the other hand, brand merchants need to pay to gain exposure in the public domain traffic pool, and the cost will continue to rise. In comparison, although private domain traffic also requires merchant operation and maintenance, the cost of acquiring customers is relatively low and more long-term and brings direct sales conversions.

Finally, as more and more people pay attention, brands and businesses will be able to build a private traffic pool, making it possible to expand other services.

How to manage traffic from public domain to private domain?

This requires a specific analysis based on the characteristics of different platforms. Different types of platforms have different development stages and product genes, so their user size, growth rate, duration, stickiness, and fan quality will also vary significantly, which will have a fundamental impact on the operation of private domain traffic.

In the dimensional space of traffic centralization and class mobility, the lower the centralization, the higher the fan value; the lower the class mobility, the higher the fan value.

• High degree of centralization and high class mobility, typical examples are Douyin and Xiaohongshu.
• High degree of centralization and low class mobility, typical examples are Taobao, Tmall, and Weibo.
• Low degree of centralization and high class mobility, typical examples are WeChat and Kuaishou.
• Low degree of centralization and low class mobility, a typical example is Bilibili.

Considering the traffic, WeChat is the undisputed leader in the private domain, followed closely by Kuaishou (similar to QQ), and Bilibili also has certain potential.

Although Taobao, Weibo, and Douyin mainly rely on public domain traffic, they also hope to create a certain scope of private territory through a certain degree of decentralization of the platforms.

1. WeChat’s traffic operation logic

WeChat first established a highly decentralized social tool, thereby forming a powerful traffic flow, which is strongly connected through social networking.

On this basis, WeChat has established a content platform for official accounts and video accounts to enhance the platform stickiness of individual users beyond social connections.

WeChat groups and mini-programs (including live broadcasts) further retain users. WeChat groups expand users' strong social connections into the pan-social field, enabling users to establish social connections with more secondary users; mini-programs realize user conversions, including content, stranger social connections, transactions, etc.

Personal service accounts and corporate WeChat allow brand merchants to connect with individual consumers in the form of "individuals" in the organization, and achieve more consulting services and shopping guide sales conversions through social connections.

WeChat's public domain traffic mainly comes from content platforms (official accounts and video accounts) and personal friend circles (public domain for the platform and private domain for individuals). Brand merchants can obtain private domain traffic in the form of free content (pictures, texts and short videos) and social connections (adding friends to WeChat groups and creating new WeChat groups), and convert it into personal friends and public account fans.

Of course, advertisers can also place advertisements through Tencent's advertising platform - Guangdiantong or the backend of the official account, and obtain public domain traffic from other official accounts (advertising on video accounts should be increased in the future) and personal circles of friends in a paid manner, and convert it to their own official accounts, or directly transfer it to the mini program for conversion.

WeChat’s operational logic for converting public domain traffic to private domain traffic is very simple. It uses various tools as carriers to combine free content and free social connections with paid advertising. This not only meets the needs of leading brands to efficiently obtain private domain traffic, but also meets the needs of small and micro brands to obtain private domain traffic for free.

Of course, the two are not absolute, and free and paid can be switched at any time with a low threshold.

The WeChat ecosystem is open, and third-party service platforms help merchants monetize their e-commerce. Despite banning external links and induced sharing, WeChat has achieved a closed business loop within WeChat through mini-program upgrades and iterations as well as third-party service platforms.

Taking Youzan as an example, it helps merchants build their own mobile shopping malls and mini-programs to open online stores, conduct online marketing, obtain orders and manage customers, and helps merchants monetize private domain traffic within the WeChat system.

1. Taobao’s traffic operation logic

Taobao is a centralized e-commerce platform where users search for products based on their search behavior. The platform has absolute control over traffic, and store collections have limited influence.

Taobao mainly involves itself in private domain traffic through content-based platforms, including Haohuo, Taobao Toutiao, Wow Video, Weitao, etc., among which the most important is Taobao Live.

Live streaming is an interactive video based on a “following” relationship. User traffic is dispersed among the hosts’ rooms, and the hosts have a strong influence on users. Live streaming e-commerce places more emphasis on “trust”, and has stronger stickiness than live streaming rewards that are “based on looks”.

Taobao's centralized e-commerce and live streaming seem contradictory, but they are not. Taobao Live has created a very good private traffic operation pool, but because the main site is unable to direct traffic to the live broadcast (especially merchants), this is determined by search behavior, and Taobao Live is inherently "traffic hungry."

In fact, Douyin and Kuaishou have also provided traffic sources for Taobao live broadcasters for a long time, and Weibo, Xiaohongshu, and Bilibili have also joined one after another.

Live streaming is an important carrier of Taobao’s private domain traffic. From the perspective of product design, it can be accessed through the Taobao App and Taobao Live App respectively.

Taobao Live, which emphasizes "attention" and adopts the "waterfall flow" recommendation method, has created a considerable space for "private domain traffic". (There will be a notification bar for each live broadcast of the anchor you follow)

At present, although there are a large number of store live broadcasts, the top 100 are mainly dominated by influencers in terms of both quantity and GMV, which is consistent with the content orientation of live broadcasts.

E-commerce content improves conversions, content e-commerce creates demand, and store live streaming has great potential in improving conversions, but it is difficult to maintain private domain relationships through continuous live streaming content.

For the three types of anchors, the value of live broadcasting to private domain operations varies:

Merchants have store anchors: This is the basic foundation of Taobao and Tmall. Live streaming can be the icing on the cake, but it will not deviate too much from the original commercial structure.

Experts have store anchors (such as Wei Ya): The platform provides relatively little support for their traffic on the main site. On the basis of their own high-quality supply chain, through expert live broadcasts, they can better maintain users, which is the direction with the most potential;

Expert anchors without stores (such as Li Jiaqi): They can attract fans and generate revenue through the positioning of "human Juhuasuan" (that is, Pinduoduo's low-priced hot-selling & worth-buying buyer model), "feed back" to brand merchants, and bring new users to the platform. This is the current mainstream direction.

Efficiency and scenario-based nature are the advantages of Taobao Live. Taobao Live, which is positioned in shopping scenarios, has a fan value that is much higher than other platforms (as reflected in fan live broadcast conversion rate, live broadcast purchase conversion rate, etc.).

The seamless connection with a mature and high-quality supply chain also provides influencers with product guarantees, so Taobao Live has become the first choice for cooperation for many content platforms.

3. Traffic operation logic of Douyin/Kuaishou

Short videos are a form of expression of rich media, not its essence. Their core is still determined by the product and content ecology - Douyin is strong in media and weak in community, while Kuaishou is strong in community and weak in social interaction.

Douyin recommends first and then follows, while Kuaishou uses recommendation as a trigger for following, thus achieving the synergistic effect of "recommendation" and "following". This is determined by the difference in their traffic mechanisms.

Douyin pays more attention to "recommendations", while Kuaishou is more inclined to "attention". It is like "watching TV or watching people, you will watch TV in your spare time, but you will always open the door to watch the people you care about."

Algorithms and interactive design complement each other, and the "waterfall flow" facilitates "follow" and "same city" interactions.

From the perspective of user experience, opening Tik Tok directly enters the playback mode, and changing videos by swiping up and down. This lazy interaction increases user stickiness and weakens user willingness to change.

The probability of using the "Nearby Section" and "Follow Section" has been greatly reduced, and users' attention is focused on the high-quality content of top users (the TikTok algorithm determines that the recommended content is of higher quality without the need for further user operations), and centralization has intensified.

On the other hand, Kuaishou’s three interaction modes (discover, follow, and same city) are all “waterfall flow” (it is recommended that they can be changed to large-screen mode, which needs to be set manually).

And due to the algorithm mechanism, the density of high-quality content displayed by Kuaishou is not as high as that of Douyin, and users need to select. This is why the frequency of use of "Follow" and "Same City" is so high.

It seems that "scrolling playback" is more suitable for Douyin, and "waterfall flow" is more suitable for Kuaishou, and "waterfall flow" + "fair algorithm recommendation" (limiting the flow of top videos to give other mid- and tail videos display space) together shape Kuaishou's "social attribute" space.

Therefore, Kuaishou places more emphasis on the relationship between users, and its private traffic ecosystem is more mature; Douyin’s traffic is more controlled by the platform, and its private traffic ecosystem is still being explored.

The reach of short videos is restricted by algorithms, and live streaming is still an important carrier of short video private domain traffic. In addition, Kuaishou’s group chat function also has potential.

The entrance to Douyin live broadcast is mainly the "Live" in the upper left corner. It is still in large-screen mode, downplaying the focus and still following the platform traffic logic. The entrance to Kuaishou Live is on the first line under the Follow Tab, making it very convenient for users to connect with the host.

Unlike Douyin, which only provides group chat for users who follow each other, Kuaishou’s group chat function is similar to QQ (not limited to user relationships), making it more convenient to maintain fan relationships.

In terms of stickiness, duration and retention rate, Douyin, Kuaishou and QQ are very similar.

On the one hand, it seems to mean that the user ceiling of short video platforms is approximately equal to that of QQ;

On the other hand, Kuaishou is expected to take further steps in its social attributes, which will also be more conducive to private domain traffic operations.

In the early days of live streaming sales, Douyin and Kuaishou connected to third-party e-commerce platforms such as Taobao, Tmall, and JD.com to help content creators collect commissions based on the CPS method.

In the past few months, Douyin has imposed more restrictions on online influencers selling products - limiting the number of sales videos and requiring product links to jump to the internal information flow interface. Kuaishou has also relied more on its own construction and SaaS products such as Youzan.

In the short term, the centralized e-commerce platforms’ well-developed shelves, ingrained user habits, and good fulfillment systems cannot be replicated in the short term, but in the long term, building one’s own e-commerce system and better serving merchants is an inevitable choice.

Author: Zhuang Shuai

Source: Private Domain E-commerce Research Center